Wipro to buy US-based Viteos Group for $130 million

With this, Wipro has continued with its traditional “string of pearls” acquisition strategy of making several buyouts of small companies that are a strategic fit.Anirban Sen | ET Bureau | Updated: December 23, 2015, 12:13 IST

BENGALURU: India's third largest software exporter has agreed to buy US-based back-office outsourcing firm Viteos Group for $130 million, continuing with its traditional "string of pearls" acquisition strategy of making several buyouts of small companies that are a strategic fit.

The acquisition will be completed in the quarter ending March 31, 2016, Wipro said.

Viteos was founded in 2003 and is headquartered in Somerset, New Jersey, Wipro said. Viteos currently has a presence across major markets such as the US, Europe and Asia and has over 400 employees on its rolls.

Wipro is betting that the Viteos acquisition will help them make further inroads in crucial banking and financial services industry, a sector where it has traditionally lagged larger peers such as Tata Consultancy Services, US-based Cognizant Technology Solutions and Infosys.

"The IT services industry is moving to an 'as-a-Service' model, and the future of BPS is going to be BPaaS (Business Process as-a-Service). Our strategy is to invest in industry vertical platforms which will provide platform-based services to our clients in transaction/outcome-based pricing models. Viteos will further our strategy in the Capital markets domain," said Shaji Farooq, President & Chief Executive of Finance Solutions at Wipro.

During Wipro's annual shareholder meeting earlier this year, billionaire chairman Azim Premji had said that the company had enough financial muscle to pursue more acquisitions.

The acquisition comes a few months after Wipro bought Denmark-based Designit for 85 million euros and also at a time when Wipro is undertaking a large-scale organizational overhaul in the lead-up to a possible CEO succession next year after current chief executive TK Kurien's term ends in February.

Cross-town rival Infosys has also been active with acquisitions over the past 12 months especially, having bought three medium-sized companies under chief executive Vishal Sikka's watch -- in February, Infosys bought Israel-based Panaya for $200 million, while in April the company acquired US-based e-commerce services provider Skava for $120 million. And more recently in October, Infosys bought oil and gas consulting firm Noah Consulting for $70 million.